What downsides might there be in resigning before the end of my contract?

Question

I'm currently working at an startup, which is the first company I've joined since the start of my career. This startup is co-founded by one of my friends (who became my housemate) and I was invited to join their startup by him.

I was able to fit in pretty quickly. Now I've befriended almost everyone there (there are 7 people in total: 5 co-founders and 2 employees). I became friends with the CEO. He's a nice guy and we go out and have fun with other guys there regularly.

The Problem

After a few months, I started to get frustrated with my job, because I think I'm taking too many responsibilities and they are underpaying me. I told the CEO guy my problem, but he told me that they can not afford to raise my salary.

Recently, I got a job offer from a medium-sized company, providing higher salary, insurance, transportation and more nice stuff. I visited their place just to confirm whether the offering was real or not, and they confirmed it.

I think I drew the picture pretty clear here. Now I'm stuck between whether to leave this startup or not. The new company offering is valid for the next couple of months and my contract with the startup lasts for the next six months. The contract doesn't allow me to quit unless the employer accepts to OR I pay a relatively small amount.

Now, I want...

• to get a much higher salary (I mean, who doesn't?)
• not to lose my friendship with the startup co-founders and co-workers
• not to lose my reputation for this "quitting" thing
• to keep my relations with my housemate positive

What downsides might there be to resign before the end of my contract?

Answer 1

After a few months, I started to get frustrated with my job, because I think I'm taking too many responsibilities and they are underpaying me.

The exciting part of working at a startup is you get to collaborate with a small group of people you enjoy being around, and you usually learn a lot about cutting edge technology. And sometimes (rarely) you might get a chance to be part of a big payday at the end.

The downside is you're often overworked, and not paid very well.

Remember however, that the grass, as they say, is always greener on the other side.

You might find at the medium size company the people are not as fun to work with. There might be levels of management or bureaucracy that you didn't have to deal with at the startup. The work itself might not be as interesting.

You don't really mention much about what's keeping you at the startup, so I'm guessing you don't have equity or any other contractual obligations that mandate you stay.

I would be sure to find out what if anything you'd be missing out on (equity, bonus, penalties) by leaving before the end of your contract.

You'll have to balance the potential bad parts of a new job against what you do in fact like about your current position.

Answer 2

Now, I want...

• to get a much higher salary (I mean, who doesn't?)
• not to lose my friendship with the startup co-founders and co-workers
• not to lose my reputation for this "quitting" thing
• to keep my relations with my housemate positive

What downsides might there be to resign before the end of my contract?

Seems like you already know many of the downsides.

• You could lose the friendship (and perhaps the respect) of co-founders and co-workers
• You professional reputation could suffer
• Your relationship with your housemate may suffer

In addition, the company culture will clearly change. Working in a 7 person startup is very, very different from a medium sized company.

• You'll likely no longer have much impact on the company as a whole
• You'll likely lose the ability to learn and advance extremely quickly
• You'll likely face far more office politics, bureaucracy and administrivia
• You may lose any potential going-public windfall that sometimes occurs at startup
• You'll certainly be a much smaller fish in a much larger pond

You get to decide what is more important to you.

I've worked for plenty of startups, a handful of mid-sized companies, and a few megacorps over my career. I far prefer startups - but that's a very personal choice we must each make for ourselves.

Before you decide to jump ship early, make sure you reflect on why you didn't understand what you would be getting into with this startup and how much you would be getting paid. Make sure you aren't jumping into a new situation where, after a few months, you will again feel underpaid and with too many responsibilities.

Answer 3

I may be new to the whole "startup" thing but in my opinion the difference between "startup" and any other company is that there is no lack of money in them.
Jokes aside.
From my point of view they taken an advantage of you. You are their friend so they can burden you with new responsibilities and not pay you for them. After all, we are all friends in here, right?
IMHO you will lose that "friendship" the moment you show you want less tasks to do (let them hire somebody else to do that. that's a point of startup - you want to grow) or be adamant about pay (if the startup is not making money it's a sign to abandon the ship).

Why would your reputations suffer from this? A bigger, more stable, better paying company saw your potential and are willing to pay you for it. That show your personal growth and that you can develop.

If your friends are really friends they will understand that all the "+" you mentioned are good for you and you are doing good thing choosing the better option.